ExxonMobil isn’t all that worried about climate change (alt): in a report on the implications of climate change on Exxon’s business, “[Exxon] accepted that carbon dioxide emissions created by burning fossil fuels were raising global temperatures, and that warming created risks, but argued that the threat needed to be weighed against other objectives, including the need for energy in developing countries.” Furthermore, “we are confident that none of our hydrocarbon reserves are now or will become ‘stranded’.” Meanwhile, the latest report from the U.N. Intergovernmental Panel on Climate Change (IPCC) says “India’s high vulnerability and exposure to climate change will slow its economic growth, impact health and development, make poverty reduction more difficult and erode food security.” Furthermore, “the report predicts a rise in global temperatures of between [0.5 to 8.6 Fahrenheit] and a rise of up to [32 inches] in sea levels by the late 21st century due to melting ice and expansion of water as it warms, threatening coastal cities from Shanghai to San Francisco…evidence suggests tourists will choose to spend their holidays at higher altitudes due to cooler temperatures or the sea level rises, hitting beach resorts.” Meanwhile, former Chinese president Jiang Zemin is worried about a different kind of footprint (alt): “[Zemin] has urged the current leadership to rein in the toughest anti-corruption campaign in decades, which is threatening the interest of some Communist party elders…In the past few weeks, producers of high-end spirits like Diageo, Pernod Ricard and Remy Cointreau have reported double-digit first-half collapses in sales in China and have explicitly blamed Beijing’s austerity drive for their woes.” President Xi Jinping’s effort to purge China of all its tigers and flies (alt) has become a seriously dangerous ordeal for those in China described as part Dick Cheney, part J Edgar Hoover with an annual spending budget of around $100bn. Also, a closer look at the “anti-vice driven growth in Chinese government deposits” suggests that the anti-corruption campaign could be dragging Chinese GDP down by about 90bps.
“On balance [the bullish purchasing managers’ reports] suggest euro-zone manufacturing is picking up, with the French and Italian surveys beating expectations and helping to offset a slight undershoot in Germany. Indeed, overall the survey details suggest euro-zone manufacturing performance is starting to converge at a modest but steady clip.” Meanwhile, “German unemployment fell for a fourth consecutive month in March…highlighting the strength of the job market in Europe’s largest economy and boding well for expectations that domestic demand will drive growth this year…Germany’s unemployment rate is considerably lower than the euro zone average, where the jobless rate was at 11.9 percent in February.”
Paul Krugman loves to kill zombies. Here’s the latest: “the belief that America suffers from a severe ‘skills gap’ is…a prime example of a zombie idea — an idea that should have been killed by evidence, but refuses to die…In an ever-changing economy, there are always some positions unfilled even while some workers are unemployed, and the current ratio of vacancies to unemployed workers is far below normal. Meanwhile, multiple careful studies have found no support for claims that inadequate worker skills explain high unemployment.” For what its worth, Boston Consulting Group concurs. Meanwhile, the Economist asks, How productive are robots?: “There is an enormous difference in the intensity with which robots are used in the manufacturing sectors of different economies…this difference can partly be explained by the composition of the manufacturing sector; robots are used most intensively in car manufacturing, and so economies that devote a larger share of manufacturing resources to car production will use more robots.”
“Some of the biggest technology companies are now making how they are paid a priority. Having a hand in how people exchange money, they are realizing, has huge potential to deliver profits — and valuable data. At stake is not only billions of dollars in revenue, but also the ability to shape how people buy, sell and pay in the future.” Furthermore, “as smartphones enable users to take their digital wallets into brick-and-mortar locations, retailers and payment providers are reassessing how online money and in-store products might interact. Beyond just enabling e-commerce on the go, many smartphones offer in-store purchases with digital wallets like PayPal and Google Wallet, using near field communication, or N.F.C., technology.” Also, “Kiss Your Bank Branch Goodbye” is a common headline these days.
“As US equity investors bid adieu to the weakest first quarter in five years, few are dwelling on the lacklustre performance. Indeed, many appear to be ignoring any warning signs about the economy’s prospects: a disappointing 0.5 per cent gain on S&P 500 in the first three months, set against the strong performance of long-dated bonds since January…’There is still a bit of suspicion in the bond market that there is something more to the economy’s slowdown than the cold weather.’…This has played out in the equity market, with economically sensitive sectors such as consumer and industrial stocks lagging behind, while bond-like proxies, notably utilities and real estate investment trusts, have rallied sharply.”